Average worker gets smallest pay rise for two decades as prices hit pockets

Published:08:43Thursday 20 November 2014

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Average weekly pay for full-time workers went up by just £1 in the year to April to £518, the smallest growth since 1997, new figures have shown.

Annual increases averaged about 1.4 per cent a year between 2009 and 2014 but the latest figure represents a rise of 0.1 per cent, said the Office for National Statistics (ONS).

Adjusted for inflation, weekly earnings fell by 1.6 per cent, continuing a trend since the recession, to levels last seen in the early 2000s.

The bottom tenth of full-time employees earned less than £288 a week, compared with £1,240 for the top 10 per cent.

The data also showed there were 236,000 jobs with pay less than the national minimum wage in April. About 9,000 of those were held by 16-to-17-year-olds, and 31,000 by 18-to-20-year-olds.

Matthew Whittaker, chief economist at the Resolution Foundation, said: “Today’s bleak figures contrast with signs last week that the UK’s six-year pay squeeze was coming to an end.

“While today’s data relates to April - a period in which we already knew pay was falling - the depth of decline highlights just how tentative any recent recovery remains.”

The gender pay gap has narrowed to 9.4 per cent, the lowest since records began in 1997.

The Government welcomed the reduction but conceded there was more to be done.

Minister for Women and Equalities Nicky Morgan said: “I am delighted that the gender pay gap has reduced to its lowest point in history. However, there is more to be done and the Government will continue to work with industry to make sure it reduces even further.

“Women are vital to the success of our long-term economic plan and we need to make the most of their skills at every age.

“We have more women in work than ever before but businesses need to value diversity in their workforce and pay attention to the role of women in their organisations.”